The H1-B Fiasco, Redux

123,480 applications in two days for a pool of just 65,000 H-1B visas, the Bureau of Citizenship and Immigration Services was forced to run a lottery to see who would get a visa and who wouldn’t. With a full year to decide what to do about this year’s tranche of applicants, the Bureau has gone back to the drawing board, and decided that this year it will, er, run a lottery again.

The big problem here is that the 65,000 number is far, far too low. As I said last year:

For three years after 2001, the H-1B quota was raised by Congress to 195,000 – and even that was too low. That it’s now back to 65,000 is a national embarrassment. Compared to most immigrants, holders of H-1Bs are highly educated, pay lots of taxes, and benefit both the economy and their local communities. The cost of educating them has been borne elsewhere, and now they want to give the benefits to the US. As a nation of immigrants, it should be welcoming them with open arms.

Critics of the present system complain that too many H-1Bs go to foreign-owned companies. They also complain about the visa lowering wages:

Ron Hira, a professor of public policy at the Rochester Institute of Technology, said that gaps in the rules had allowed technology companies, including American ones, to misuse the program.

“Basically, H-1B has been thoroughly corrupted,” Mr. Hira said. “Under H-1B you could be forced to train your own replacement,” he said, speaking of American workers.

Mr. Hira pointed out that current rules do not require employers to prove a labor shortage by advertising jobs or recruiting in the United States. He said wages established for H-1B technology workers were below market levels in this country, allowing companies that use the visas to gain a competitive advantage and lowering wages over all.

As Dean Baker quite rightly points out, it’s far from clear why high-tech workers should be insulated from foreign competition when steelworkers aren’t. And I think that Hira in any case is simply wrong: I’m pretty sure that you do need to advertise locally the jobs for which you’re looking to hire an H-1B worker instead.

The immigration debate is always fraught. But most of the time there’s general agreement that the US should be open to high-quality legal immigration. That’s exactly what the H-1B provides, which is why the H-1B program should be vastly expanded.

Update: Be sure to read the comments on this post. They’re really good.

Update 2: Hira is in fact right: you don’t need to advertise a job you’re looking to fill with an H-1B worker. But there are still labor market protections:

Any employer wishing to bring in an H-1B worker

must attest in an application to the DOL that the employer will pay the H-1B worker

the greater of the actual wages paid other employees in the same job or the prevailing

wages for that occupation; the employer will provide working conditions for the H-1B worker that do not cause the working conditions of the other employees to be